‘We’re In Trouble’: Trader Warns Interest Rates to Surge, Destory Stocks

5/7/2026 7:48:09 PM	medium term up	20 days later	-4.84%	-4.84%
4/9/2026 12:09:14 AM	medium term cautious up	20 days later	-3.00%	-1.50%

5/7/2026 7:48:09 PM	medium term down	20 days later	+3.38%	-3.38%
4/9/2026 12:09:14 AM	medium term down	20 days later	+9.30%	-9.30%

5/7/2026 7:48:09 PM	short term cautious down	5 days later	+5.87%	-2.93%
4/9/2026 12:09:14 AM	short term down	5 days later	-5.47%	+5.47%

David

Introduces the historic day with Trump signing an Iran deal, markets euphoric with Dow up 600 points, S&P up 1.5%, NASDAQ up 3%, Bitcoin up 5%, Gold up 2.5%. Asks Todd if he is staying long or waiting to short.

Todd Horwitz

I am staying long but always hedged. The underlying economy is weak: 13% of credit card debt 90 days past due, 6% defaulting on car loans, 4% on mortgages. True unemployment (U6) is 8.5%. The K-shaped economy is getting worse. The Iran deal has buoyed markets, but I am looking for a place to sell into this rally and take a short position.

David

Asks which assets Todd is most looking forward to shorting.

Todd Horwitz

I am already short crude and will look to cover but not for a while. I am looking to short the NASDAQ and the S&P. They will be higher in 10 years, but we are due for a 5-10% sell-off. We saw a preview 10 days ago when NASDAQ was down 6%.

David

Asks why Todd is still short oil at current levels, given he was bearish near $100.

Todd Horwitz

I have been short since $110-$115 and will stay short. There is an overwhelming glut of oil in the US, which will only grow with resumed Iranian flows. The economy is weak, and demand is lacking. I think oil will be back in the $60s before the year is over.

David

Asks about a specific downside target for oil and if he uses technical analysis.

Todd Horwitz

From a technical standpoint, we are getting a blow-off bottom, which might indicate a bounce. I will live through it. My next target to sell is around $85. I would sell August oil at $85 if it gets there.

David

Asks what Todd would do if the S&P 500 reaches 8,000 points.

Todd Horwitz

I would be a seller long before 8,000, depending on how it gets there. If it goes to 8,000 in the next 5 days, I would be an automatic seller. If it's a slow, dull grind, I would be more patient.

David

Asks if gold lagging the S&P in recent weeks is a signal.

Todd Horwitz

Gold did exactly what I am talking about in crude and the S&P: it got up too far, too fast. It hit $5,500 parabolically and is now paying the price. But I believe we have put the bottoms in around $4,100-$4,056. I think gold will go back to $5,500 and possibly $6,000 before year-end.

David

Asks what Todd is most bullish on now.

Todd Horwitz

I am most bullish on the metals: gold and silver. They have made their bottoms. My number one and two trades are gold and silver.

David

Asks how Todd would trade the Iran deal news specifically.

Todd Horwitz

I am looking to sell into this rally. The volume is too light to get involved as a buyer. I am sitting on the sidelines waiting for an opportunity to sell. My next trade will be to the sell side.

David

Asks if the Iran deal is a reason to go risk-on or to take profits as a contrarian.

Todd Horwitz

If you are a trader, you are definitely taking profits here. Investors should stay in. From a trader's standpoint, you have to take profits. The odds favor a pullback of 2-5% that will give you an opportunity to re-enter.

David

Asks about the outlook for US gas prices, tying it to the Iran deal and Todd's lower energy call.

Todd Horwitz

We have seen the highs at the pump for consumers. We will not see those ridiculous high prices again. Gasoline at the pump will not go much higher. We have seen the highs for the year, and prices will come down.

David

Asks if he would bet on the Strait of Hormuz closing again.

Todd Horwitz

If the deal fails, there will be another problem, but we are our own producers and sitting on a glut of oil. We should never have been at these high prices. Shell had record profits, so the panic is over. Oil could pop to $85 or $90, but not back into the hundreds based on the Strait of Hormuz.

David

Asks Todd to explain his trading methodology.

Todd Horwitz

First, decide if you are investing or trading. For investing, I use options to hedge and never sell. For trading, I use Bollinger Bands set to 3 standard deviations. Any move 3 standard deviations from the mean has a 90% probability of retracement. You are trying to pick off panicking or FOMO traders.

David

Asks about the difference in mentality between casino gambling and trading indices.

Todd Horwitz

Poker and trading are the same. You have to wait for opportunities, maximize profits when you have them, and minimize losses. You have to be patient. I made 6 trades today when I normally make 600, showing how patient you must be.

David

Asks why Todd wouldn't get into the SpaceX IPO and applies his philosophy to its chart.

Todd Horwitz

I don't like trading IPOs. There is not enough liquidity, and they move too fast. It's hard to set a stop. SpaceX has spiked straight up from $148 to $185 with no pause. That is a sell signal to me, not because I am negative on the company, but because of the parabolic move.

David

Describes the hype around SpaceX (people at a Chinese restaurant, a mother with two kids texting him) and asks for Todd's thought process.

Todd Horwitz

When everyone wants to participate, that is a screaming sell signal. I will take you back to Beyond Meat (traded to $300, now worthless) and Tilray (traded to $300, now zero). SpaceX is a sale here. Today's volume is a third of Friday's, meaning buyers are exhausting themselves. You will probably see SpaceX trade in the $170s or $160s before the week is over.

David

Applies the same logic to gold's chart, asking if Todd had the same thought during its parabolic move.

Todd Horwitz

Yes, right there (pointing to the parabolic spike in gold). That is exactly what I am talking about. Silver has the same chart. Gold has put its bottoms in. I hope it goes up slowly and grinds higher to draw in new money.

David

Asks about common mistakes he observes in trading.

Todd Horwitz

The market is never wrong. Anyone who says it is wrong gets fired. The market is absolute. Your own worst enemy is the person you look at in the mirror. You need a plan and a decision for every trade, including your exit and loss potential.

David

Asks what people mean when they say 'the market is wrong'.

Todd Horwitz

They are trying to say they are smarter than the market. I can give you all the reasons why we should be down, but the markets are higher. I have no reason to sell right now because it's not giving me a reason. The market is never wrong because it is price discovery.

David

Asks about the potential for a short if the Fed (Kevin Warsh) starts hiking rates.

Todd Horwitz

The market is already pricing in a 60% chance of a hike. Warsh is more of a hawk. The key is how he handles the speech. If he is clear about inflation concerns and accelerating rate hikes, you could see a significant sell-off. If he is gentle and smooth, the market stays where it is.

David

Asks if higher bond yields worry him and put pressure on the economy and S&P 500.

Todd Horwitz

I think the 10-year note is going to 6% before the year is over. Interest rates are going a lot higher. We are in trouble. New homes in Vegas are being offered with no money down, which is a repeat of 2008. This will affect the balance sheets of companies.

David

Asks what happens when interest rates hit 6%.

Todd Horwitz

When we get to 6%, I think you see the S&P down to probably about 5,500. We get the sell-off I have been looking for. But don't go out and start selling the market now. You have to have a reason to get short. I have no reason right now.

David

Comments on the discipline required to stay long when your thesis is short, and asks Todd to explain the logic.

Todd Horwitz

The stock market has gone up 8.5% year-over-year since 1950. If you buy good companies, you will make money. If you missed the 10 best days over 40 years, you made 50% less. If you missed the 20 best days, you made a third. I am a hedger, but I tell everyone to just stay in the market.

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